A bill that doesn't pay the bill

WASHINGTON — While the House Democrats spent the week congratulating themselves for squeezing out the midnight passage of their version of health care reform, neutral observers were reminding them: You've left the job half done.

Having watched Hillary and Bill Clinton try and fail even to bring their version of health reform to a vote, I can certainly join in saluting Speaker Nancy Pelosi, her leadership team and the Obama White House for maneuvering the 1,990-page behemoth to harbor.

But as many sympathetic voices have been telling them: Unless you find more realistic ways of paying for the promises included in the bill, you are simply setting the public up for more frustration — and yourselves for a political backlash.

At least a dozen health and budget experts have filled the Web and the airwaves with warnings that the House bill simply postpones the cost controls needed to finance the vast expansion of insurance coverage and Medicaid benefits envisaged by its sponsors.

One of them speaks with special authority: David Walker, the former head of the Government Accountability Office — the auditing and investigative arm of Congress — told me in an interview on Wednesday that the lawmakers are "punting on the tough choices, rather than making sure they can deliver on the promises they're making."

In a speech delivered less than 48 hours after the House acted, Walker, now the president of the Peter G. Peterson Foundation, laid out the tests that buttress his conclusion.

Acknowledging that "clearly, we need radical reconstructive surgery to make our health care system effective, affordable and sustainable," Walker cautioned that "what we should not do is merely tack new programs onto a system that is fundamentally flawed" — and rapidly driving the national budget into ruin.

He proposes a four-part test of fiscal responsibility for any health reform plan: "First, the reform should pay for itself over 10 years. Second, it should not add to deficits beyond 10 years. Third, it should significantly reduce the tens of trillions of dollars in unfunded health care promises that we already have. Fourth, it should bend down — not up — the total health care cost curve as a percentage of GDP" (the gross domestic product).

An analysis by the Lewin Group shows that the Energy and Commerce Committee bill that was the basic blueprint for the House measure comes close to meeting the first of those tests and fails the other three, according to Walker, "by a wide margin."

A separate Lewin Group study of the Finance Committee bill from which Majority Leader Harry Reid is working on the Senate legislation shows it almost as much of a fiscal failure. It fails the fourth test, falls short on the third, and passes the first two only by assuming that future Congresses will force reductions in reimbursements to doctors and hospitals that past lawmakers have refused to impose.

Walker, a close observer and former employee of Congress, calls that assumption "totally unrealistic."

In reading his analysis — and the comments of the many others who have appraised the House's handiwork — what becomes clear is that unless something intervenes, Congress is headed toward repeating a familiar pattern. Just as it did, under Republican control, in the George W. Bush years, when it passed but did not pay for a Medicare prescription drug benefit, it is about to hand out the goodies and leave it to the next generation to pick up the bill.

The Senate could still reduce the damage. If it began to move away from the fee-for-service payment system that rewards doctors and hospitals on the quantity of procedures they perform, rather than on the results of the treatment, that would help. If it reduced the biggest single loophole in the revenue system — the tax-exempt status of employer-provided health benefits — that would help a lot.

Otherwise, while congratulating each other for an overdue piece of social legislation, Congress could end up condemning our children to a far worse financial future than they deserve.